In this Uniswap Review for 2022, we take a dive deep into the popular decentralised exchange platform. We take a look at what Uniswap is, their supported cryptos, fees, support, pros and cons.
UniSwap is a Decentralised Exchange (or DEX) allowing users to trade any ERC20 Ethereum-based token directly through a web3 wallet such as the likes of Metamask or Coinbase Wallet. No deposits or withdrawals are required, using liquidity pools instead of order books.
So let’s dive into this Uniswap review to see if Uniswap is the right decentralised exchange for you.
What is Uniswap?
Uniswap was launched onto the Ethereum main net in November 2018 and is a decentralized exchange (DEX). Made up of 2 main elements “Swap” for exchanging your tokens and “Pool” for providing liquidity and earning fees. Swap provides a one-stop shop for exchanging any ERC20 token in a few clicks without having to worry about KYC, deposits, or withdrawals.
By leveraging smart contracts, Uniswap can offer autonomous on-chain transactions at marginal costs with no listing fees and native tokens required. Plus, Uniswap claims to have some of the cheapest gas costs of any DEX.
Pools enable users to earn trading fees (paid by those swapping) by providing liquidity to the Uniswap Pools.
After only one year of the release of V2, Uniswap upgraded to Uniswap version V3 in May 2021. Introducing concentrated liquidity and the ability to use layer two networks such as Arbitrum, Optimism, Polygon and Celo for lower transaction costs.
Uniswap continues to be the dominant DEX, with approximately $1.1 trillion in trade volume as of August 2022.
How to Use Uniswap DEX?
Getting started on Uniswap is very easy, especially if you already have a web3 wallet setup. Uniswap allows users to retain custody of their funds without needing KYC (Know Your Customer).
Unlike popular centralized exchanges such as Coinbase Pro or Binance Exchange, there is no lengthy sign-up process, disclosing your name, passport, address, etc.
All you need to get started is a web3 wallet such as MetaMask, Coinbase Wallet or wallets supporting WalletConnect. Connecting a wallet to Uniswap is very simple. Just click “Connect to a wallet” in the top right, and you will have the option to pick your wallet.
If you’re new and don’t yet have a web3 wallet setup, you can check out the tutorial I have created on two of the most popular web3 wallets, MetaMask and Coinbase Wallet.
Uniswap Pros & Cons
UniSwap Supported Tokens
UniSwap supports any ERC-20 token in the Ethereum ecosystem. This means you can swap popular tokens like ETH, BAT, COMP, LINK, WBTC, and stablecoins such as DAI and USDT.
Since the upgrade to Uniswap V3, users can also trade across multiple networks, including Ethereum, Optimism, Arbitrum, Polygon and Celo. Helping users to save money in transaction (or gas) costs. Click here to see a full list of Uniswap’s supported tokens.
Please note: Uniswap does not support buying cryptocurrencies with FIAT (or traditional currency) like USD, GBP or Euros. To start using Uniswap, users will already need to own some crypto which they can buy directly from within their web3 wallet or via exchanges such as Binance or Coinbase.
Uniswap Supported Networks
Another advantage of Uniswap is its low trading fees which are currently at 0.30% per trade. This 0.3% fee is then split by the liquidity providers (LPs) proportional to their share in the pool.
Users will also need to pay gas (or network) fees for completing their transactions on the network, which will vary depending on the congestion of the network. These fees can be reduced by using layer two networks such as Optimism or Arbitrum.
There are also proposed protocol fees of 0.05%. However, this has not yet been approved (as of August 2022). You can read more about these here.
Slippage (when trading) refers to the difference between the expected price of a trade and the price at which the trade is executed. Slippage can occur at any time, but due to high volatility in the crypto markets, this can accrue more frequently than in traditional markets.
How to Adjust Slippage
To adjust slippage on Uniswap, click the cog icon on the top right-hand side of the screen. In the transaction settings, you can adjust the slippage tolerance. If your slippage tolerance to too tight, you may run the risk of the transaction failing and costing you transaction fees. This can be very frustrating and costly. However, if the tolerance is too wide, you may end up receiving less crypto from the trade.
Tip: Check out Uniswap Analytics, where you can do some research on your trading pairs and adjust your slippage tolerance accordingly.
UniSwap Failed Transactions
This was one of the most frustrating things I found when using Uniswap, and cost me a lot of ETH in the process. With so many trading pairs to choose from you, I tried to pick some “Up and coming tokens” with small market caps. However, due to the small caps, there was little liquidity, and having my slippage tolerance too tight caused the transactions to fail.
When the transaction fails, your funds are safe and will be returned back to you. However, the Gas fee will be deducted. These failed transactions can really add up, so increase the Gas fee you´re paying to speed up the transaction and/or adjust the slippage tolerance.
UniSwap Fake Tokens
There seems to be a scam around every corner in the world of crypto, and the Uniswap DEX is no different. Uniswap allows any ERC20 token to be added to its DEX, so you may find a token with the correct name, ticker, or logo, but it’s actually a fugazi, fake, or scam token. Unfortunately, if you trade for a fake token, you may lose your crypto as there are no refunds or authorities you can go to.
UniSwap Token Lists
Uniswap has introduced a feature called Token Lists, a new standard for creating lists of reputable ERC20 tokens. This community-led initiative aims to create a system that distinguishes between the most trusted DEFI tokens to separate fake and scam tokens.
These token lists come from projects on Ethereum that maintain lists of ERC20 tokens that are hosted publicly on ENS, IPFS, or HTTPS following a standard JSON schema. These projects attach their reputation to the lists by hosting them on a domain that they control. For example, the likes of CoinGecko have a list on CoinGecko.com that they control, and CoinMarketCap has an ENS domain that they control.
As part of the initial list, Uniswap introduced lists from the likes of CoinMarketCap, CoinGecho, Dharma, Compound, Aave, and 1Inch exchange. They’ve also launched a homepage and list browser at tokenlist.org and a community forum at commiunity.tokenlists.org.
UniSwap UNI Tokens
Uniswap has its Uniswap UNI token, an ERC20 token on the Ethereum network. These UNI tokens are available for trading on many of the popular crypto exchanges, including centralised exchanges such as Binance and Coinbase.
The token is used for governance actions in the Uniswap protocol. A total of 1 billion UNI have been minted at genesis and will become accessible over the course of 4 years.
How to Claim your Uniswap Airdrop?
There will also be a lot of other wallets and apps that use Uniswap in the background, and you may be entitled to further UNI tokens. For example, users of Argent wallet and PoolTogether can also claim if they swapped Ethereum on their platform. Therefore it’s always worth checking or asking to see if you have any available.
Is Uniswap Safe?
Uniswap is non-custodial and does not use order books, therefore does not store or hold any funds. Meaning Uniswap is very secure, especially compared to centralized exchanges. Uniswap will only be as secure as the Ethereum blockchain or how safely you protect your assets.
One of the biggest risks is being duped by scam projects and tokens, imitating real projects. However, with the user of their token lists, this should help to reduce this risk. Users can also search for a token´s contract address and paste it into Uniswap to ensure they are using the correct token.
Answers to the most common Uniswap issues can be found within the FAQ section of the Uniswap site. However, if this doesn’t answer your questions, you can join the community Discord to get support. They also have Twitter, Discourse and Reddit Communities you can access.
Verdict: Should you use Uniswap?
Uniswap does not have a mobile app and is only available through the Uniswap web platform. Any apps on the AppStore or GooglePlay claiming to be Uniswap are not official or supported, so please don’t be fooled.
UniSwap has only been the biggest fraudsters for weeks, take your gas fees, and not so little, but they do not deliver any exchanges for a quarter of the time, just wanted to exchange ETH for tape again after about 30 minutes, I got a message that the Exchange failed, but 5, -USD fees were deducted. Avoid this scam Exchance UniSwap.
I feel your pain, I have $25 worth of transactions fail. I’m not sure its UniSwaps fault, I think it’s down to the congestion on the network. However, I used ZapperFi to do the same transaction and it went through straight away and at a cheaper cost